I don't see the conflict that resulted in UN Peacekeepers at the border of Southern Lebanon and Israel a failure. I believe it was a huge victory for peace in the face of a failed ally, namely the USA. I believe things are getting a little scary for some Israelis, due to the active pursuit by Arab nations to stabilize the region. Not to dismiss the dangers that could assail Israel with economic platforms. But, if Israel falls victim to violence, Europe won't tolerate it.
The Arab world has an opportunity before it, to secure a Middle East that is economically harmonious while recognizing each other as strong allies in the fight against radicals that like to call the Middle East 'their mission.'
No country in the Middle East needs it's leadership undermined. Not Egypt, Jordan, Saudi Arabia or Israel. To confirm a respect for Israel in the face of radical values only firms up the regions stability.
I've never known an Israeli Prime Minister that wasn't under political attack and rigous attack at that. Olmert will survive.